The proposed project is a secondary analysis of existing panel data. It will focus on the role of household tastes for various consumer goods and for children in connection with income in order to test some of the implications of the economic theory of fertility. It will concentrate on one of the important variables in the economic model of fertility which has been largely neglected in previous studies; that is, tastes for goods other than children. Data used to test the economic model have usually not been appropriate for testing the role of relative preferences in linking income and fertility; yet, a basic implication of the model is that the strenth of a household's desire for any given good (such as children) must be measured in the context of its attitudes toward other goods. From the basic formulation of the model follow a number of hypotheses to be tested which relate fertility, income, and desires for children and goods. In addition to testing these hypotheses, it will be possible to test directly some of the current untested ideas surrounding taste formation. The influence of such background variables as number of siblings and education on the preferences for both goods and children will be tested. These data also allow a test of some of the current theories linking desires for children and goods to the status of the family of orientation relative to that of the household making fertility decisions. The proposal also outlines several methodological problems to which these data are relevant. For example, we shall investigate the validity of couples' permanent income expectations and the utility of the relative income concept as a control for taste. In addition to testing these substantive and methodological problems, we expect to develop techniques for operationalizing the concepts of the model which can be employed in future research.